New Jersey adult-use cannabis shops sold $116,572,533 worth of cannabis products from July 2022 to September 2022, according to receipts reported by the New Jersey Cannabis Regulatory Commission (NJ-CRC). If medical sales are included, the state’s record $116+ million in third-quarter cannabis sales jumps to more than $177 million, regulators said.
There are 20 dispensaries in New Jersey that are licensed for recreational cannabis sales and are currently serving customers with another 10 licensed for just medical sales.
“New Jersey is only seeing the beginning of what is possible for cannabis. We have now awarded 36 annual licenses for recreational cannabis businesses to New Jersey entrepreneurs, including 15 for dispensaries. Those businesses alone will be a significant growth of the market. With more locations and greater competition, we expect the customer base to grow and prices to come down.” — ” Jeff Brown, NJ-CRC executive director, in a press release
“We are looking forward to seeing local, small business owners participate in this lucrative market,” NJ-CRC Chairwoman Dianna Houenou said via press release. “Our priority application process as well as new initiatives like the no-cost Cannabis Training Academy being launched by New Jersey Business Action Center in early 2023 are paving that path for them to be included.”
Cannabis sales in Washington have slowed this year for the first time in the decade since voters first approved the state’s legalization language, the Seattle Times reports. The drop ends a trend of growing sales that has continued since the Washington market’s 2014 launch, including a significant surge during the pandemic.
“What you’re seeing as a ‘dip’ is really sales returning to normal growth as more people returned to in-person work.” —Brian Smith, Washington State Liquor and Cannabis Board spokesperson, via the Seattle Times
Washington collected $509 million in excise revenue for the 2022 fiscal year.
The Washington CannaBusiness Association said the declining sales could be partly due to high taxes on cannabis products — the state holds a 37% excise tax on cannabis sales which, combined with an already high sales tax rate, sees some Washingtonians paying an average of 46.2% in taxes on cannabis purchases, the report said.
Washington’s adult-use cannabis sales are expected to top out this year at between $1.3 and $1.5 billion, according to estimates in the 2022 MJBiz Factbook.
Washington and Colorado were the first two states to formally adopt cannabis legalization policies in 2012 but this year, both states have reported declining cannabis sales. Since those early market launches, 19 states plus Washington D.C. have followed in Washington and Colorado’s footsteps to end cannabis prohibition at the local level but the plant remains federally illegal, complicating the state-legal industries.
LOS ANGELES, California, December 15, 2022 — E1011 Labs, a California-based heat-not-burn innovator, is pleased to announce that Higgs, a California-based premium lifestyle cannabis brand known for its distinctive ‘90s-era branding, has joined the E1011 Labs Pilot Partnership Program (“P3”). P3 allows its members to leverage E1011 Labs’ patented heat-not-burn technology to enhance each member’s diversity in product offerings while establishing combined market share in the heat-not-burn segment.
Higgs is the second member of E1011 Labs’ P3 ecosystem, but is notably the first member from the Cannabis industry, and thus brings an unprecedented strategic strength and potential for this particular partnership.
Higgs’ heat-not-burn offerings will be their second hemp-derived product offering, in addition to their array of cannabis products, most notably their signature pre-roll packs, currently available in select states. Oliver Higgins, founder and CEO of Higgs, stated, “Partnering with E1011 Labs furthers our mission of creating products that are focused on happiness and having a good time with friends and loved ones. Now we are offering even more ways to sit back and let the good times roll.”
The Higgs Lemon Lime stelo™ and Higgs Mixed Berry stelo™ are now available online at www.e1011labs.com and will begin to be available at select retail locations across the United States. On E1011 Labs’ direct-to-consumer platform, customers may also subscribe to the Higgs products and have them delivered on a monthly or bi-monthly basis.
E1011 Labs enters 2023 with excitement and optimism as they continue to evaluate and select key partners to help advance their initiative in the heat-not-burn segment within Hemp and Cannabis. Subscribe to their newsletter at www.e1011labs.com to be in the know about the latest launches and product line developments.
About E1011 Labs
Headquartered in Los Angeles, E1011 Labs embodies the spirit of a modern tech company, while still drawing inspiration from the deep-rooted traditions of the industry. They manufacture and distribute the elon®, a patented, state-of-the-art, heat-not-burn device and premium hemp flower cartridges intended to be used with elon®. On a mission to provide safe, affordable, and convenient access to cannabinoid wellness, E1011 Labs leverages innovative technology and thoughtfully crafted formulations. By entwining ancient holistic traditions with modern innovations, they are at the forefront of revolutionizing the future of cannabinoid consumption while ensuring maximum preservation of the plant’s integrity with minimal waste.
For additional inquiries regarding partnerships contact:
partnerships@e1011labs.com
Senate Majority Leader Chuck Schumer (D-NY) is planning one last-ditch effort to attach cannabis banking reforms to the omnibus funding package, Politico reports.
Democrats sent revisions for the banking reforms to their Republican counterparts on Thursday, addressing some of the concerns raised by Senate Banking Committee Ranking Member Pat Toomey (R-PA) and Judiciary Committee Ranking Member Chuck Grassley (R-IA). But the cannabis banking language must still face its most likely hurdle in Senate Minority Leader Mitch McConnell (R-KY), who has repeatedly derided Democrats’ efforts to attach the reforms to omnibus legislation.
Yet Schumer still intends to push the bill with other legislative leaders on Friday and over the weekend, which likely represents the last opportunity to see cannabis banking reforms approved this Congress, the report said. The proposal enjoys bipartisan support from Schumer and Sens. Steve Daines (R-MT), Jeff Merkley (D-OR), Rand Paul (R-KY), and Dan Sullivan (R-AK).
An effort to attach language from the SAFE Banking Act and two other pieces of cannabis legislation to the annual National Defense Authorization Act earlier this month was squashed by McConnell and other Republicans, and the Minority Leader said at the time he would work to keep similar language out of the omnibus funding bill, as well.
Officials with the Washington Liquor and Cannabis Board (LCB) announced they were suspending the license of Port Angeles-based Dank Incorporated after discovering “serious violations of state cannabis laws,” the agency said Thursday in an email.
Regulators said that after finding both “untagged” cannabis plants and plants whose tracking tags had been used previously — both in violation of state cannabis laws — they seized approximately 5,000 cannabis plants from the Dank Inc. facility.
“Additionally, on or between June 2021 and present, the licensee violated Washington’s ‘true party of interest/financier’ law (WAC 314-55-035) by allowing undisclosed and/or approved persons, affiliated with a criminal enterprise, to control the day-to-day operations, and engaged and/or permitted criminal conduct.” — LCB email announcement excerpt
LCB said violations included issues around traceability, the company’s true party of interest, and criminal conduct including the probable diversion of cannabis into the unregulated marketplace. Officials said that based on the seriousness of the violations and the likelihood the licensee would commit such violations again in the future, it had issued an immediate 180-day emergency suspension of Dank Inc’s cannabis operator license and would seek for the license to be permanently revoked during that timeframe.
Washington regulators have issued similar emergency license suspensions in the past, including in October 2021 when the license of Okanagan-based Emerald Flash was suspended over allegations of cannabis product diversion, misrepresentation, and other concerns.
The co-founders of Bend, Oregon-based cannabis tech company Dutchie — who the company said stepped down earlier this month — have filed a lawsuit in Delaware’s Chancery Court claiming they were wrongfully forced out of the company, Law360 reports.
The suit targets Dutchie’s current Executive Chairman Timothy Barash and the following four board directors: Karan Wadhera, Wilder Ramsey, Gaurav Ahuja, and Thomas Linovitz. The plaintiffs, brothers Ross and Zachary Lipson, claim they were victims of a “blatant ambush” during a November 28 board meeting where the board passed pre-drafted resolutions terminating them both “for cause.” The suit also describes a vote to remove the co-founders from the board, strip them of their key stakeholder status, and amend the company’s voting agreement language to enable Barash to become CEO.
The Lipsons are asking the court to declare that their removal and the board’s actions on November 28 were invalid, that Ross Lipson is still a director and the company’s CEO, and that Zachary Lison is still a director and the company’s chief product officer.
Earlier this month, Dutchie said in a press release announcing the Lipsons’ departure that, “Ross and Zach Lipson have departed the company after a long tenure of driving growth, passion, and innovation in the cannabis industry.”
Dutchie claims to be the largest e-commerce company in the world for dispensaries with services including point-of-sale, e-commerce, payments, and insurance software specialized for the cannabis industry. The company has more than 5,000 dispensary partners and processes in excess of $14 billion in annual cannabis sales, the report said.
Dutchie was founded in 2017 and reportedly held a total valuation of $3.75 billion by the end of 2021.
The latest hemp industry report by ResearchAndMarkets suggests that the global industrial hemp market is expected to grow from $6.8 billion in 2022 to $18.1 billion by 2027, recording a compound annual growth rate of 21.6%, according to a press release.
Growing acceptance of hemp as an agricultural crop was listed as one of the major contributors to the market’s growth, as well as increased awareness of the crop’s nutrient-rich profile and benefits for human health. Hemp is also the most readily available source of legal cannabinoids as many countries allow hemp farming but not the cultivation (or possession/use) of cannabis.
The crop also contains essential fatty acids from hemp seeds and hemp seed oil, which increases its use in the food and beverages industry, pharmaceuticals, and personal care products, the release said. Another hemp industry byproduct includes hemp meal, which is a high-fiber, -fat, and -protein feedstuff used in animal agriculture that could substitute for soybean meal in many livestock diets.
Hurdles for the burgeoning industrial hemp industry include complex regulations that can vary dramatically between nations, as well as ongoing stigmas against hemp for its associations with its psychoactive counterpart, cannabis.
Additionally, the report highlights other challenges which farmers will need to confront, including a lack of suitable seeds for industrial hemp cultivation and a lack of specialized hemp processing facilities and farming equipment.
Welcome to the second installment of our 2023 Cannabis Industry Predictions series! The cannabis, hemp, and psychedelics industries are poised for an incredible 2023 with multiple new markets, exciting inventions, and millions of new consumers looking to partake in the industry.
With this week’s collection of expert input, we prioritized cannabis industry professionals and leaders in the fields of cultivation, agricultural technology, and science. This section will also cover predictions for the burgeoning industrial hemp market, expected trends for psychedelics-based wellness, and other policy developments.
Scroll on to read more, or click here to check out the first installment of our 2023 Cannabis Industry Predictions series.
Cultivation
Photo credit: Sam Gehrke
Jesce Horton – Chief Executive Officer at LOWD “More markets will experience saturation as new licensees become operational and others expand their footprint. Cultivation companies must improve efficiencies in their operations via process and energy improvement measures, and improve quality and consistency to remain competitive.” Visit website
Carlos “Los” Arias – CEO of Green Horizons “Cultivation in 2023 will be driven more than ever by Low COGS and strategic partnerships. Operators that have enacted efficiencies to drive lower COGS and align their plant material to an in-house brand(s), and/or strong off-takes, will be the winners. The inevitable commoditization of raw plant material has arrived and is the new normal. I do think we’ll see an uptick in prices throughout the year, but wholesaling material ad infinitum is not a tenable long-term strategy, particularly in California. Partial integration, with the right execution and strategy, can survive and thrive in any market environment.” Visit website
Agtech
Albert DeChard – Owner of Geomat “I believe the droughts and scarce water conditions many regions are currently facing will only continue to become a more prominent and pressing problem among agricultural industries. More specifically, indoor agriculture is amidst an environmental revolution, meaning it will be of utmost importance to install sustainable practices and efforts that are designed to save wastewater throughout the various roles and uses in cannabis. States and counties will experience more restrictions on water use, and cannabis and agricultural industries will be directly affected and urged to further capture, conserve, recycle, and reuse the precious resource that is water.” Visit website
Brett Stevens – CEO of Fohse “The industry is under a lot of pressure as it continues to develop and become more competitive, so growers are looking for solutions that yield more product while using less energy. Unfortunately, there are a few bad actors – who are overpromising and under-delivering. At Fohse, we have spent years doing R&D focused on innovation and sustainability before taking products to market ensuring the cannabis industry receives the highest quality products it truly deserves. Regarding 2023, we are working even harder to meet and surpass our customers’ demands. Customers want optimal greenhouse application, increased yields and decreasing energy use so the demand for high-wattage lights with high efficacy and low failure rates are in demand.” Visit website
Science
Lo Friesen – Founder and CEO of Heylo Extracts “In 2023, solventless concentrates will remain a coveted premium product. However, I see a bleak future for products in the “Live Resin” category. Because Live Resin is an extract produced from fresh-frozen cannabis flower it has a completely different chemical profile than its cured form. Companies have taken advantage of the fact that there are no agencies monitoring the use of names like “Live Resin”. Consumers are being deceived and lawsuits have already begun. I look forward to consumers becoming more skeptical, putting their money in companies that earn their trust, and demanding better cannabis products.” Visit website
Matthew Noestheden – Market Development Manager for SCIEX “We’ve seen a lot of progress regarding testing standardization in recent years, and I expect that to continue into 2023. There has also been a strong push by organizations like NIST and AOAC International to offer certified reference materials (CRMs) for cannabis and hemp. I hope to see regulators mandate the use of CRMs as they become more broadly available. They are the perfect complement to standardized testing and in tandem they will greatly advance our function in the industry, which is to support consumer safety.” Visit website
Kristen Goedde – Founder and COO of Trichome Analytical “Despite the legalization of hemp cultivation several years ago, cannabis and cannabis-derived ingredients remain unapproved by the FDA for use in food. However, the recent appointment of an experienced cannabis policy expert hints that the FDA may soon finalize regulations for cannabis-derived products. Beyond ensuring the safety and efficacy of cannabinoid-infused products, FDA regulations on cannabinoid hemp products will provide a baseline for future federal high-THC cannabis regulations. I expect to see some form of regulatory framework on the testing, manufacturing, and labeling of cannabinoid hemp products before the end of the year.” Visit website
Josh Rubin – Co-Founder & CEO of Day Three Labs “As we know, questionable additives are making their way into emulsions that are used in everything from gummies to beverages. As the industry matures, we’re seeing more demand for transparency in edibles’ ingredients from consumers and manufacturers as well as greater consumer expectations for a predictable edibles experience. While many cannabis companies will continue to focus on cutting costs in 2023, those with the capacity for R&D and continued investment in innovation will be well positioned for the future of the edibles market which offers a fast-acting, consistent high, with clean and simple ingredients.” Visit website
Photo credit: Sam Gehrke
Katie Stem – President, East Fork Cultivars “We saw up to a 30% increase in non-cannabis materials costs in 2022, and are hoping this trend plateaus. Cannabis pricing decreased, which we expect to continue on a slow downward trend in Oregon. Overall, the market will continue to compress and commoditize because of saturation, MSOs and consolidation. We have taken a proactive approach to these challenges and have chosen to merge with another small, local company, East Fork Cultivars. Together we hope to weather the upcoming economic storm by capitalizing on vertical integration, merged administrative costs, and a more diverse combined leadership team.” Visit website
Dr. Harold Han, Chief Science Officer at Vertosa, Inc. “From 2023 onward, brands will differentiate themselves by creating products with unique formulations backed by science. The use of strain-specific formulas and minor cannabinoids or other complimentary active ingredients supported by scientific data like pharmacokinetic (PK) and pharmacodynamic (PD), will help brands validate the efficacy and distinct experience consumers can expect. This data could allow for verified marketing claims such as ‘fast-acting’ or ‘promotes relaxation’ to build trust with consumers. Budtender education will play a critical role in passing this information to consumers to equip them with the knowledge to make better choices about the cannabis they consume.” Visit website
Micheal Backes, Co-founder and Chief Product Officer at Perfect “2023 will be the year of terpenes and consistency. The cannabis plant is capable of producing an enormous range of flavors and effects beyond boring “cake and pie” strains with ridiculously inflated THC levels. 2023 is the year consumers will seek a consistent terpene high, rather than a dull THC stone.” Visit website
Hemp
Weiwei “Vivian” Fellman – Founder of Kota Botanics “I look forward to 2023 as I anticipate that the CBD industry will continue its steady growth. Besides retail shops like Kota Botanics, we are seeing more and more cannabis dispensaries carrying CBD lines, and it continues to gain acceptance in the natural health and beauty industry. CBD will always have a place in the cannabis industry since not all consumers want the high or euphoria. They want something to manage their pains and stress, and Kota Botanics is proud to be able to provide quality and trusted products.” Visit website
Sergiy Kovalenkov – Founder of Hempire “Hempcrete is on the rise, people demand architects to design homes using sustainable materials because they want to live in healthy houses. USHBA has done an incredible job bringing hempcrete into US building codes and by educating professionals. Now governments across the world need to step in and protect the farmers by subsidizing hemp programs and providing more grant opportunities. As the world is going through major transformations, hemp will play a crucial role in terms of survival of humans without any exaggeration by providing local economy with food, construction materials, energy biomass and clothing. Traditional supply chain doesn’t work, since transport sometimes costs more than hemp inside the container. This is unacceptable! Only local products for local economy.” Visit website
Psychedelics
Matthew X. Lowe Ph.D. – Research Director for Unlimited Sciences
In the coming year, we’ll see initiatives bolster research examining the therapeutic potential of psychedelics in treating a range of mental health conditions, and solidify psychedelic therapy as the next frontier in mental health treatment. However, research continues to be held back by bureaucratic red tape and funding limitations, and widespread efforts to increase profitability in the psychedelics industry will fuel heightened tensions between corporate- and community-based approaches to psychedelic access. We may see widening inequality in the indigenous, traditional and grassroots communities from which plant medicine has originated, and we must seek out approaches that engage with meaningful reciprocity to honor these communities and ensure equal access. Visit website
Ronan Levy – CEO and Chairman of Field Trip Health
“The interest in psychedelics is growing at an undeniable clip. Last year, 7.1 million Americans alone used psychedelics in some capacity. Psychedelics have been described as “the worst kept secret in corporate America”. Everywhere you turn, psychedelics are in the news, on TV or being discussed. The momentum feels palpable.” Visit website
The Source+ will be the first Massachusetts cannabis store to permanently close its doors since the state launched its legal adult-use market in 2018, Marijuana Business Daily reports.
The Northampton–based shop, which is owned by a Las Vegas-based cannabis company and operated by Just Healthy, received its license in 2019 and started sales earlier this year in April. Northampton is reportedly a competitive market for cannabis retailers, with at one point sporting 12 shops despite being a relatively small city with fewer than 30,000 residents.
The closure comes as Massachusetts experiences a sharp decline in legal cannabis prices that has carried on for more than a year, Boston.com reports.
The state hit its lowest prices yet in October at an average of $7.76 per gram of flower, then crawled back up to $8.04 per gram in November. That, however, was still lower than September’s average price per gram of $9.17, which was an all-time low for the state, and the average price per gram in August was ilkewise the state’s all-time low, the report said.
Theory Wellness CEO Brandon Pollock said that the industry’s early days had been marked by high prices due to the slow rollout of licenses, which initially created higher demand at the few shops that were able to open. But Pollock said in the report that the last 12 months have been “drastic” with wholesale market prices “down approximately 50% in one year.”
Joseph Lekach, CEO of cannabis company Apothca, said the primary issue is oversupply:
“There’s an extreme oversupply of flower, edibles, concentrates, vapes, basically any cannabis product.” — Lekach, via Boston.com
Lekach predicted that “a lot of companies” may go out of business next year and into 2024, warning that while consumers may appreciate the lower prices, they will likely note a drop in quality as cannabis operators adjust to the market changes.
“You’re going to have an inferior product coming out,” he told Boston.com. “It’s a double-edged sword.”
Lawyers for the Ontario Securities Commission (OSC) moved this week to withdraw all charges against former CannTrust Holdings Inc. officials Peter Aceto, Eric Paul, and Mark Litwin, according to a CBC report.
“After careful review of the evidence during the trial, we are of the view that as charged, there is no reasonable prospect of conviction.” — OSC attorney Dihim Emami, in a statement
The trial, which began in October, was tied to alleged compliance failures at CannTrust. Regulators suspended CannTrust’s cannabis operations license in 2019 after accusing the company of growing and selling cannabis in unlicensed rooms and failing to maintain proper documentation of its business. Prosecutors charged the company executives with securities offenses related to telling investors that CannTrust’s grow facility was fully prepared and operational.
But during trial testimony, defense attorneys argued that CannTrust’s full greenhouse was in fact licensed. Additionally, per Health Canada regulations outlined in cross-examination by CannTrust’s former director of quality and compliance, there were no restrictions on which rooms CannTrust could use to grow cannabis, undercutting the prosecution’s case, the report said.
Defense attorneys for the embattled cannabis executives have asked prosecutors to go beyond simply dropping the charges and order full acquittals for their clients but Emami asked for additional time to consider the request.
Since the suspension of its license and through the resulting trial, CannTrust — once valued at $1.5 billion through the New York and Toronto stock exchanges — has declared bankruptcy, sold off most of its assets, and changed its name to Phoena Holdings Inc.
New York Gov. Kathy Hochul has signed a bill amending part of New York’s agriculture law to encourage the incorporation of hemp products into various industries such as construction, packaging, and others, Marijuana Moment reports.
Introduced by state Sen. Michelle Hinchey (D), Senate Bill S8496 prioritizes the research, funding, and business development of hemp-based packaging, food, fiber, construction materials, and cannabinoids. Specifically, the bill mandates the New York agriculture commissioner to consult with the New York State Hemp Workgroup and other industry stakeholders in investigating the use of industrial hemp-based products like biodegradable plastics, paper, and hempcrete.
“Hemp is the material of the future, and positioning New York as a leading producer of the world’s industrial hemp supply is a winning strategy for fighting the Climate Crisis, bringing large-scale economic development to New York’s rural communities, and unlocking new revenue sources to put our farmers in a better financial position. I’m proud that my hemp bill has been signed into law, directing our state to seek strategic collaborations to help us usher in a new era of manufacturing power, product creation, and rural economic development around an industry that is nearly untapped around the world.” — Sen. Hinchey, in a press release
The bill had been approved by state lawmakers in May and was signed into law late last month, the report said.
In addition to developing its industrial hemp industry, New York is poised to begin regulated adult-use cannabis sales after licensing the state’s first 36 cannabis retailers last month.
Editor’s note: This editorial was contributed by Johnny Green, Media and Content Director for the International Cannabis Business Conference.
The legal cannabis industry is rapidly becoming a global juggernaut and as anyone that has paid attention in 2022 will be quick to point out, the legal international industry is barely scraping the surface of its overall potential. It’s likely that 2023 will yield more of that potential being tapped, yet to what degree is open to debate.
As it stands right now there are three countries that have passed adult-use legalization measures. Uruguay was the first back in 2013, Canada followed in 2018, and in late 2021, Malta became the first country in Europe to pass a nationwide legalization bill. Multiple countries also had legal decisions previously rendered by their top courts regarding the unconstitutional nature of cannabis prohibition, such as South Africa, Italy, and Mexico. Legalization efforts are taking longer than expected in those jurisdictions, however, eventually sensible cannabis policy will win out.
Will any country legalize cannabis in 2023?
Going into 2023, there is an enormous ‘cannabis policy elephant’ in every room around the globe where legalization discussions are being held. I am talking about Germany, of course, and no 2023 cannabis policy speculation is complete without first touching on what is happening within Germany’s borders.
In late 2023, following the International Cannabis Business Conference (ICBC) where representatives from all of Germany’s major political parties held historic cannabis policy discussions, a federal election was held and a new governing coalition was elected. The new governing coalition, often referred to as the ‘Traffic Light Coalition,’ wasted no time in indicating its intent to pass an adult-use legalization measure and to launch a regulated adult-use industry.
Currently, Germany’s Health Minister is making the case for German legalization at the European Union level. In an ideal scenario, the European Union would give its blessing to Germany’s legalization plan, which involves producing all cannabis domestically for an adult-use market and allowing adult households to cultivate up to three plants.
Gaining approval from the European Union (EU) would likely preemptively thwart any legal challenges from other EU member nations. What happens with Germany and the EU will largely dictate what happens around the globe in 2023, whether cannabis supporters around the world realize it or not, and it will surely dictate what happens throughout the rest of Europe. According to the latest reports out of Germany, a legalization measure is expected to be formally introduced in 2023, and it could open the floodgates to similar measures being introduced in other parts of Europe and beyond.
Evolving markets
As global cannabis observers continue to hold their collective breath and monitor the political saga in Germany, other regulated markets will continue to evolve. One market that is particularly noteworthy is Malta, where regulators are expected to start accepting non-profit cannabis club applications in February 2023.
Cannabis clubs already exist in Canada and Uruguay but a successful launch of the regulated club model in Malta could prove to be very significant for similar efforts elsewhere in Europe. Spain, for instance, is home to hundreds of unregulated cannabis clubs and activists have tried for years to get them officially recognized by Spain’s government, to no avail. The only exception is Barcelona where local lawmakers passed a cannabis club measure, although the measure would later be voided by a court decision. If Malta succeeds, it could provide a blueprint for other regions.
Meanwhile, changes are coming to Uruguay’s cannabis legalization model in 2023, proving that cannabis policies are still evolving in the world’s oldest legal, nationwide adult-use cannabis market. Uruguay initially passed its legalization measure in 2013 with regulated sales through pharmacies starting in 2017. Since the start of sales, consumers have had only two options of low-THC cannabis to purchase. A flower option with a higher level of THC content is coming to pharmacies in Uruguay this mont, and a fourth option is expected in late 2023.
Canada, which is home to what is often described as ‘the largest cannabis policy experiment on earth,’ will continue to see its cannabis industry evolve, with its grip on direct international cannabis exports continuing to wane to some degree. Many of the countries that Canadian companies were historically exporting medical cannabis to are ramping up their own domestic production, often with involvement from Canadian companies in some manner.
I expect legalization to continue to spread at the local level in the United States and Mexico in 2023, with national reform likely remaining elusive due to ongoing federal political hurdles in both countries throughout the year. The African and Oceania continents will experience significant growth in 2023 in medical markets that are currently established. Unfortunately, cannabis policy on the Asian continent will likely continue to be the worst on the planet, except for Thailand.
A momentum-building year
The emerging legal cannabis industry will continue to thrive in 2023. Statistical records will continue to be broken at the macro level, and that is a trend that will presumably continue well into the future until most countries have passed legalization measures and launched their own regulated industries.
With that being said, unless Germany passes a legalization measure in 2023, it’s likely that no other country will do so in the calendar year. I expect 2023 to be a historic year for cannabis policy but it will be more so on the introduction side of the equation versus the finalization side.
Even if Germany gets a legalization measure to the finish line in 2023 — which I am certainly hoping for — other countries will likely take longer to finalize their own measures, as Germany started its process earlier. Furthermore, actual legal sales of adult-use products in Germany in that scenario would likely not start until 2024, if only because Germany’s current legalization model involves cultivating all market cannabis domestically, and that is not going to happen overnight.
In my opinion, 2023 is going to be the calm before the storm at the global level for cannabis in many ways. It will be the year that we see more cracks starting to leak in the metaphorical dam that is prohibition, prior to it bursting wide open in 2024. As such, innovators, inventors, entrepreneurs, investors, and industry service providers would be wise to position themselves in a way that ensures they can take full advantage of the winds of change that are gaining speed with each passing year. A great way to do exactly that is to join me in June 2023 in Germany at the ICBC, where cannabis industry and political leaders from around the world will once again be converging in Berlin.
Qualla Enterprises LLC, a medical cannabis firm set up and operated by the Eastern Band of Cherokee Indians, is set to receive $63 million following a Tribal Council vote on December 9, Smoky Mountain News reports. The money will fund staffing increases at the company as well as a new indoor grow site and retail facility. The council also voted to fill two vacant board seats and set pay rates for Qualla Enterprises’ board of managers.
In a statement to the Tribal Council, Qualla Enterprises’ general manager Forrest Parker expressed gratitude for the funding and for the council’s faith in the firm:
“It gives us a lot of confidence that we’re surrounded by people that have done this so many times, that have the experience, that have the understanding. This tribe, I’m so proud of us for putting us in a position to learn from other people’s mistakes so that when we do this right, that number is precise. It’s not $150 million because we’re trying to cover all these things that we don’t know. We actually feel like we actually know.” — Parker, via Smoky Mountain News
The Cherokee Nation in Oklahoma announced plans in 2020 to study the potential ramifications of major cannabis and hemp policy reforms while last May, the Tribal Council for the Eastern Band of Cherokee Indians in North Carolina approved both medical cannabis legalization and the possession of up to an ounce of cannabis by adults aged 21 or older.
Qualla Enterprises is currently approved for just medical cannabis sales but an expansion to adult-use cannabis may be possible later down the line.
Kansas state Sen. Rob Olson (R) said during a December 9 meeting of the 20222 Special Committee on Medical Marijuana that he intends to file a medical cannabis legalization proposal next year, the Kansas Reflector reports.
State lawmakers have considered but ultimately rejected multiple such proposals this year, including a House-approved proposal that never advanced in the Senate and a separate Senate proposal by Olson, introduced in March, the report said. The committee has since met multiple times to discuss the state’s medical cannabis legalization prospects for next year.
After the most recent meeting, Sen. Olson said he will draft a new medical cannabis proposal for the start of the 2023 legislative session.
“I think what I’m going to do is — and any member is more than welcome — is to take this information and create the bill. And I’m going to work on a bill with a couple members, and then if anybody wants to sign on in the Senate, they’ll be more than able to sign onto that bill, and introduce it at the beginning of session.” — Sen. Olson, via the Kansas Reflector
Kansas Senate President Ty Masterson (R) said in the report that school funding legislation and the state budget remain bigger priorities for him than medical cannabis reforms but Sen. Cindy Holscher (D) was nevertheless hopeful.
“The whole issue is last year, we had a very strong bill that passed the House, and Senate President Ty Masterson wouldn’t allow it to move forward,” Holscher said. “So I know there are different parties who have been reaching out to him to remind him of how important an issue this is to a lot of different people.”
The Los Angeles Department of Cannabis Regulation (DCR) has selected 100 social equity applicants for an opportunity to apply for retail cannabis licenses following a lottery last week, Marijuana Business Daily reports. The city’s social equity application process was contested in a lawsuit earlier this month by a Michigan cannabis entrepreneur but a U.S. district judge ultimately ruled for the lottery process to proceed.
The successful applicants were named during Los Angeles’ Phase 3 Retail Round 2 Lottery. During a livestream of the lottery, DCR said it had contracted a third-party global business advisory firm called FTI Consulting Inc. to administer the selection process. The results were later verified by auditing firm Sjoberg Evashenk Consulting, which confirmed there were no discrepancies with the lottery process or results.
Kenneth Gay, a principal at the California-based firm Variscite, had argued in a lawsuit that Los Angeles’ cannabis social equity requirements — which require applicants to have been convicted or arrested in California for a cannabis-related crime — violate the U.S. Constitution’s dormant commerce clause, which prohibits state and local governments from giving local citizens preferential treatment over citizens from other states, the report said.
Gay had previously filed a lawsuit contesting the social equity program in Sacramento, California; he also sued over the social equity rules in New York, which temporarily halted the licensing process there.
DCR said it received more than 1,200 applications for social equity verification and more than 500 applicants had qualified for the program, the report said.
Starting next year, Massachusetts will be the first U.S. state with a legal cannabis program to add lessons about cannabis impairment to its driver’s education programs, WCVB5 reports.
The American Automobile Association (AAA) is providing the new curriculum, which will be named “Shifting Gears: the Blunt Truth about Marijuana and Driving.” Officials with the Massachusetts Department of Transportation (MDOT) said some 50,000 young drivers are expected to be taught the program each year across the state’s approximately 700 driving schools.
“The current driver education module addressing impaired driving will be updated to include research-based information on cannabis, explaining how tetrahydrocannabinol (THC), the active chemical in marijuana, affects cognition, vision, reaction time, and perception of time and distance.” — MDOT official statement, via WCVB5
Massachusetts state law requires first-time drivers who are younger than 18 to finish at least 30 hours of driver’s ed classes before they can qualify for an unrestricted license.
MDOT officials said the Registry of Motor Vehicles would join AAA and the Massachusetts Cannabis Control Commission for an event on Friday touting the new program.
“This is the first generation of driver education students to be licensed since cannabis became legal in Massachusetts, and AAA research shows that impaired driving crashes may increase and continue to injure and kill motorists and their passengers,” MDOT officials said in the report.
The driver’s ed changes come six years after Massachusetts voters approved cannabis legalization in 2016 and three years after the 2019 launch of regulated cannabis sales.
Top Republican and Democrat lawmakers in the New Hampshire House of Representatives are teaming up on a bill to legalize cannabis possession and sales, according to a New Hampshire Public Radio report.
The still unreleased bipartisan proposal is expected to contain legalization of the personal possession and sharing of up to four ounces of cannabis by adults aged 21 or older, and would open the door to regulated retail sales with a tax rate of 8.5%, the report said. The proposal would also allow for the home cultivation of up to six cannabis plants and confirms the ability of adults to possess “the cannabis produced by those plants at home.”
House Majority Leader Jason Osborne (R) suggested the bill was faithful to the will of voters:
“The House has long stood united in finding a pathway to getting this done for Granite Staters. With any luck, the Senate will come around to supporting the will of the vast majority of New Hampshire citizens.” — House Majority Leader Jason Osborne
New Hampshire’s currently ongoing prohibition of cannabis makes the state an outlier in New England, where most neighboring states have formally adopted some form of cannabis legalization.
House Democratic Leader Matt Wilhelm said that legalizing and regulating cannabis would lead to safer products and would help to better protect consumers. “Legalization of adult possession of small amounts of cannabis is the right thing to do for New Hampshire and we must get it done in 2023,” Wilhelm said in the report.
But while supported by both parties in the House, the legalization proposal faces obstacles in the Senate — which already voted down a House-approved legalization proposal earlier this year — and in Gov. Chris Sununu (R), who said in March he doesn’t think it is the right time to legalize cannabis in the state due to the ongoing opioid crisis.
Arizona cannabis retailers sold $1.6 billion worth of cannabis in 2021, putting the state second only to California as the country’s largest legal cannabis marketplace, according to a Cronkite News report.
Arizona earned $221.3 million in cannabis tax revenue in 2021, according to state Department of Revenue data outlined in the report. Additionally, Arizona generated $196.4 million in cannabis tax revenue during the first nine months of 2022, putting the state on track for about $22 million per month in cannabis excise taxes for the year. But experts said while the cannabis industry could play a significant role in generating state revenue, it has a long way to go before overtaking any of the traditional “five C’s” of Arizona’s traditional economy, meaning cattle, cotton, copper, citrus, and the climate (aka tourism).
Alexis Villacis Aveiga, assistant professor at the Morrison School of Agribusiness at Arizona State University, told Cronkite News that professional cannabis growers in Arizona typically face more difficulties and canopy restrictions than in other states due to its desert climate, which hinders outdoor cultivation.
“For example, we have 35,000 square feet of indoor cannabis and hemp. In California, there are over 4 million square feet, Colorado has over 2 million and Kentucky has around 200,000. So Arizona is pretty small compared to other states.” — Aveiga, via Cronkite News
Arizona voted to legalize adult-use cannabis in November 2020 and launched its legal market in January 2021, making it the quickest state at the time to move from voter approval to a fully-fledged recreational marketplace.
The emerging cannabis industry in Africa is poised for massive growth, according to The African Cannabis Report by Prohibition Partners. The report predicts that between timely cannabis reform efforts, the growing international market, and fading revenue from the region’s tobacco farmers, Africa’s legal cannabis market could be worth more than $7.1 billion USD by the close of 2023.
While the crop remains largely illegal or at least unregulated across much of the continent, the United Nations estimates that cultivators in Africa grow about 38,000 tons of cannabis per year and the overall cannabis consumption rate is relatively high at 13.8%, the report said. The authors also note that “the region has a wealth of experience in cannabis cultivation” because, despite its prohibition, a good deal of farmers have pivoted to growing cannabis as high unemployment rates and declining global demand for tobacco crops hurt the economies of many African countries.
“From a financial standpoint, the 50+ states and territories which comprise Africa could reap significant rewards through the legalisation of cannabis with international demand offering a strong opportunity to unlock the potential value of Africa’s legally produced cannabis.” — Excerpt from The African Cannabis Report by Prohibition Partners
Medical cannabis is currently legal in Lesotho, South Africa, and Zimbabwe; medical cannabis has also been legalized in Zambia but the country has yet to fully enact the policy, the report said.
South Africa opted to decriminalize the personal possession and cultivation of cannabis in 2018.
A 2018 report by New Frontier Data found that one-third of the world’s cannabis consumers live in Africa.
Guam’s government has so far appointed 11 “responsible officials” for the island’s new adult-use cannabis industry but nobody has yet submitted a business application to become a licensed cannabis operator, the Pacific Daily News reports.
Under Guam’s 2019 legalization law, cannabis businesses can’t receive a license or an operating permit unless they first get government approval for a responsible official in charge of the company.
The island’s Cannabis Control Board on Monday approved two such responsible official applications — one for Trisha Blas, who is set to oversee the first cannabis manufacturing facility on the island, Guahannabis LLC; and one for Eugene Arriola, a representative for The Heights Farm, which seeks to operate a 2,500 square-foot indoor cultivation site. A third application for Wang-Chieh “Ronald” Su for the Herbal World cannabis retail store was withdrawn, according to the report.
The board had previously approved nine responsible official applications including one in October for Shintaro Okada, who is set to oversee Pacific Analytical Services (which is poised to become the island’s first cannabis testing lab), the report said. Guam law requires adult-use cannabis products to be approved by a government-licensed testing lab before they can be sold to consumers.
Guam Department of Tax and Revenue representative Craig Camacho said during Monday’s meeting that the previously approved responsible officials had been briefed about the next steps for opening a licensed cannabis establishment but no one had formally submitted their applications, the report said.
“They have it, they’re working on their packet, but none of them actually submitted to the office for review or consideration at this time.” — Camacho, via Pacific Daily News
Guam’s legalization measure officially took effect earlier this year on May 29 and its first responsible officials were approved in September.
California-based Kushy Punch was handed a $128 million fine from the state for the allegedly illegal manufacturing of millions of cannabis gummies, according to an SFGATE report. The company is accused of producing millions of dollars worth of gummies (according to state investigators) at an unlicensed facility in Los Angeles.
Specifically, the case is tied to a 2019 investigation into Vertical Bliss, the former owner of the Kushy Punch brand, which discovered some $64 million worth of gummies had been manufactured for the brand at an unlicensed facility. Regulators noted it was a rare instance of cannabis diversion where illicit products were making it into the legal market when the opposite — legal products entering the illicit market — is far more common.
Nicole Elliott, the director of California’s Department of Cannabis Control (DCC), said the judgment demonstrates that illicit cannabis sales “will not be tolerated in California.”
“DCC and our partners will do everything in our power to protect consumers and maintain the integrity of California’s legal cannabis market. We applaud the Court for its commitment to enforcing the rule of law in California’s cannabis industry.” — Elliott, in a press release
The $128 million penalty — potentially the largest cannabis fine ever in California — was announced on Monday by a Los Angeles-based judge after the defendants in the case failed to provide any legal defense, the report said.
Rhode Island cannabis dispensaries collectively sold more than $1.63 million worth of cannabis during the state’s first week of adult-use sales, WPRI reports.
The cannabis sales total covers about $786,000 worth of adult-use cannabis and $845,400 worth of medical cannabis. The state can expect roughly $133,600 in cannabis taxes from the first week with about $23,500 in taxes going to the local governments which host the shops — adult-use cannabis sales in the state are taxed at 20% while medical sales are only subjected to the state’s 7% sales tax.
For comparison, the state recorded just over $1 million worth of medical cannabis sales during the last week of October.
In addition to the December 1 launch of adult-use sales, Rhode Island has also stopped charging fees for medical cannabis patients to register or renew their registration for the program. The state is also anticipating lower revenue due to the loss of cannabis-based court fees following the mass expungement of cannabis possession charges. In total, the state’s Office of Management and Budget said it expects to net just $368,000 after expenses from this fiscal year’s anticipated $5.9 million in cannabis tax revenue.
Rhode Island became the 19th U.S. state to legalize adult-use cannabis earlier this year. Under the measure, adults 21 and older are allowed to purchase and possess up to an ounce of cannabis, keep up to 10 ounces of cannabis at home, and home-grow up to six cannabis plants.
Connecticut Gov. Ned Lamont (D) announced this week that thousands of Connecticut residents with cannabis possession convictions are set to have the charges fully or partially erased. The expungement policy is tied directly to the state’s 2021 adult-use cannabis legalization law.
“On January 1, thousands of people in Connecticut will have low-level cannabis convictions automatically erased due to the cannabis legalization bill we enacted last year. Especially as Connecticut employers seek to fill hundreds of thousands of job openings, an old conviction for low-level cannabis possession should not hold someone back from pursuing their career, housing, professional, and educational aspirations.” — Gov. Lamont statement, via press release
People whose charges are erased will be able to tell employers, landlords, and schools that the convictions never happened, according to the announcement.
Under the expungement plan, people who were convicted of possessing four ounces or less of cannabis between January 1, 2000, and September 30, 2015, will have their charges automatically erased on January 1, 2023. People convicted of one of the following violations will need to file a petition in the Connecticut Superior Court:
Convictions for possessing four ounces or less of cannabis from before January 1, 2000, or between October 1, 2015, and June 30, 2021.
Convictions for possessing cannabis-related drug paraphernalia imposed before July 1, 2021.
Convictions from before July 1, 2021, for manufacturing, selling, possessing with intent to sell, or giving/administering cannabis to another person, so long as the amount involved was under or equal to four ounces, or no more than six homegrown plants.
WNBA star Brittney Griner, who was arrested in Russia earlier this year and imprisoned for 10 months on drug charges, has been set free after Russia and the U.S. agreed to a prisoner swap, CBS News reports.
The one-for-one prisoner swap took place in the United Arab Emirates and saw Griner’s release traded for the release of Russian arms dealer Viktor Bout, who was ten years into serving a 25-year prison sentence in the U.S.
“She’s on her way home, after months of being unjustly detained in Russia, held under intolerable circumstances,” the president said alongside Griner’s wife Cherelle, Vice President Kamala Harris, and Secretary of State Antony Blinken. “Brittney will soon be back in the arms of her loved ones and she should have been there all along. This is a day we’ve worked toward for a long time. We never stopped pushing for her release.”
Griner, who for years has played pro basketball in Russia during the WNBA off-season, was arrested in March after Russian customs officials at the border discovered vape cartridges said to contain cannabis oil in her luggage. Ultimately pleading guilty to the charges, she was given a nine-year prison sentence at a Russian penal colony in August.
